September 13, 2011 / 1:35 PM / 6 years ago

US "underwater" homes little changed in Q2-CoreLogic

NEW YORK, Sept 13 (Reuters) - The number of U.S. homeowners, who were “underwater” on their mortgages, saw little change in the second quarter at 22.5 percent, data analysis company CoreLogic Inc (CLGX.N) said on Tuesday.

The number of properties with so-called negative equity -- where borrowers owe more on their mortgages than their homes are worth -- totaled 10.9 million. It was a slight dip from 22.7 percent of homeowners in the first quarter, CoreLogic said.

A further 2.4 million borrowers had less than 5 percent equity and were considered to be near-negative equity. Both negative equity and near-negative equity homes made up 27.5 percent of all residential mortgages.

    “High negative equity is holding back refinancing and sales activity and is a major impediment to the housing market recovery,” Mark Fleming, chief economist at CoreLogic, said in a statement.

    Nearly 75 percent of the homeowners facing this situation were also paying higher, above-market interest rates on their mortgages, the report said, as negative equity effectively precluded refinancing to take advantage of current low rates.

    Hard-hit Nevada had the highest percentage of homes that are “underwater” at 60 percent, followed by Arizona at 49 percent. Florida, Michigan and California rounded out the top five. (Reporting by Leah Schnurr; Editing by Theodore d‘Afflisio)

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